Home Work

Dos and Don'ts of Buying a House (Part 2)

Apr 16, 2003 at 2:06 pm

Before you make your decision to write an offer for a house, go back a couple of times — if possible, go after a rainstorm to see if there are any leaks. Look for watermarks and mold on the walls, particularly in the basement and attic. Make sure none of the shingles on the roof a curling.

Almost everyone will see something on subsequent visits they didn't see previously. Remember that once you have bought it, if it's broken, you fix it. And be sure you review the "Sellers Disclosure," which provides information on problems the seller is aware of.

Unless you're a knowledgeable professional in plumbing, roofing, electricity and a variety of other building trades, you'll need to get an inspection by a certified home inspector. Be sure to attend the inspection, especially if you're a first-time buyer. As problems arise and defects are found — they always do — the inspector can provide valuable insight as to how they can be resolved.

If the property you're considering is in foreclosure or has been vacant for a while, be sure to find out why.

Was there a major repair the owner couldn't afford? A layoff, death or transfer out of town? Remember that the likelihood of more problems arising increases with vacancy, if for no other reason than no one is there to prevent, correct and minimize the potential for increased damages.

As if you don't have enough to think about, let me give you one more item to burn some mental energy with: You need to think a little about the resale value of the property in question. Have your Realtor® provide you with an analysis of what properties on that street and in that area have been selling for and at what percentage they've been increasing in value over the past three to five years. Doing so will give some reasonable guidelines regarding what to expect in the future.

Finally, ask yourself the following questions: What is it about this house that speaks to me and I find so appealing? Is it because of its architecture? Or because of its proximity to transportation, schools or shopping?

Whatever the reason is, be sure you understand why you find this home enticing. Remember that what you find attractive and positive doesn't mean that someone who is going to purchase your home down the road will feel the same way.

There are certain things you should be aware of with respect to making major improvements to your home:

· If you put so much money into your home that it's the best on the street, you're unlikely ever to get your entire investment back. Buyers won't pay more than a certain amount for a house on any particular street.

· Watch out for what appraisers refer to as "functional obsolescence." For example, a new addition can make a house "lop-sided" in that it now has five bedrooms and a family room but still only one bath or a tiny kitchen. Functional obsolescence detracts from resale value.

· Making additions onto your current home or other major improvements involves a large degree of inconvenience and mess. Give some serious consideration to your schedule, tolerance and lifestyle before undertaking any new construction on your present home.

Before beginning new construction, you should carefully research the builder's reputation by interviewing lenders, materials suppliers, subcontractors who have worked with him or her before and past clients. In addition, you should investigate court records and contact the local Better Business Bureau and state contractor's licensing boards to check for any lawsuits or complaints.

Home Work is a weekly column geared toward residential real estate.